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J.C. Penny to Close Units Knitwear Chain

DALLAS -- J.C. Penney Co. will close its Units specialty subsidiary, after several years of failed attempts to revitalize the moderate-priced knitwear chain.<BR><BR>Units has 113 stores and 850 employees. The company said it will try to hire as many...

DALLAS — J.C. Penney Co. will close its Units specialty subsidiary, after several years of failed attempts to revitalize the moderate-priced knitwear chain.

Units has 113 stores and 850 employees. The company said it will try to hire as many of them as possible in its J.C. Penney stores or headquarters in Plano, Tex., and that the Units stores should all be shut by Dec. 30.

Units stores are operated by Stinu Corp. of America, which Penney’s bought in 1987. Stinu is based in the Dallas suburb of Garland.

“Quite frankly, we are closing because our store growth and sales and profits have not met our expectations despite a number of marketing and merchandising adjustments over the past several years,” explained Jan Mikol, president of Stinu, which is Units spelled backwards. “Both sales and profits have declined in each of the past five years.”

A Penney’s spokesman said the impact of Units’ closure on Penney’s financial performance would be “virtually nothing,” pointing out that Units’ total annual sales amounted to less than the business of a single successful Penney’s store. Units’ revenues this year will range from $40 million to $50 million, Mikol said.

Local designer Sandra Garratt originated the concept of one-size fits-all polyester-and-cotton knit related separates in the early Eighties. Garratt also designed a similar line of modular knit sportswear called Multiples for Jerell Inc. here, which still sells that line through direct marketing.

Penney’s bought the Units chain when Units’ annual sales peaked at $70 million to $80 million. Within three years the chain, grew from 40 to more than 200 stores, including licensed units in Britain, Canada, Japan and Mexico that have since closed.

When sales began to falter, Stinu tried to rejuvenate Units by styling the knitwear for casual business attire, adding tailored jackets. In addition, the sizing was changed to small, medium and large. Prices ranged from $19 to $79.

However, competition in that arena, especially from discounters, was too fierce. “The customer had a broad range (of stores) to pick from as far as that kind of merchandise — department stores and discounters — so we were no longer unique,” Mikol said. “In the specialty business you have to have a unique concept to become important for the customer.”